Business sentiment has seen a swift upturn in February, as indicated by a recent survey, with companies showing greater optimism about the economy's prospects.
Additionally, firms are more inclined to recruit new staff compared to the previous month, hinting that the potential negative impact of the Budget on the job market might be less severe than anticipated, as reported by .
"The findings of the latest Business Barometer are encouraging, showing a significant uplift in business confidence and economic optimism across the º£½ÇÊÓƵ," commented Paul Kempster, head of relationship management at Lloyds Commercial Bank.
The main business confidence index surged by 12 points in February, reaching 49 percent, which is not only the highest figure since August but also considerably higher than the long-term average.
This boost was largely attributed to an increase in economic optimism, which jumped by 18 points, marking the most substantial monthly rise since late 2020.
The survey further suggests that recruitment will continue to be robust in the upcoming months, despite the impending rise in employers' national insurance contributions in April.
Hiring intentions climbed by nine points to 41 percent in February, with businesses identifying recruitment and skills development as their primary opportunities for growth over the next half-year.
Hann-Ju Ho, senior economist at Lloyds Commercial Bank, remarked that the survey underscores the "resilience" of º£½ÇÊÓƵ businesses in the face of heightened costs and considerable economic uncertainty.
"Increased optimism, along with an expected uplift in trading prospects, is prompting businesses to invest in growing and upskilling their workforce, putting them in a prime position to capitalise on increased demand and drive future growth," he commented.
The survey, which gathered insights from 1,200 businesses across the nation, presents a more hopeful view of the labour market compared to other indicators.
Contrasting this positive outlook, a report from the Chartered Institute of Personnel and Development indicated that a higher number of firms are planning job cuts in the upcoming quarter than at any point in the past decade, pandemic years excluded.
Nevertheless, Lloyds' survey is likely to fuel optimism that the recent batch of economic data, surpassing expectations, might signify a turning point for the º£½ÇÊÓƵ economy following a bleak conclusion to 2024.
